Boris Johnson only just managed to get the House of Commons on Monday evening (22.
Senior Conservative MPs had warned that they would not support the new policy to limit care costs in England, which critics say has been watered down to be less generous.
Ministers could not say whether changing the £ 86,000 ceiling on care costs would meet an election pledge to ensure no one has to sell their home to pay for care.
Backbench Tory critics, meanwhile, joined Labor MPs and experts, warning that the move to count only individual payments towards the cap, and not municipal contributions, would cost poorer recipients more wealth than the rich.
However, the government worked to fend off a possible defeat and supported the amendment by 272 votes to 246.
– Why is the government reforming social welfare?
The problem of sustainable social welfare funding has remained unsolved by successive governments, and the coronavirus pandemic has put pressure on an already under attack.
Boris Johnson, in his first speech after his election in July 2019, promised “to resolve the welfare crisis” and announced plans more than two years later in September.
The government wants to protect people from “unpredictable and potentially catastrophic care costs”, bring health and care systems closer together and strengthen the workforce.
– What are people currently paying for social care?
There is currently a means-tested system, but there is no limit on social assistance for those who are not eligible.
A significant minority will suffer catastrophic costs that will cause them to use up their savings and sell their home to pay for their care.
– What did the government propose in September?
The government announced major reforms, including a lifetime cap of £ 86,000 from October 2023, to be funded through a health and welfare levy based on tax contributions.
This is a risk bundling for the portion that would be associated with significant care costs and means that no one has to pay more than this amount in the course of their life.
It also heralded a more generous on-demand system.
Individuals with assets up to £ 20,000 do not have to contribute to their care (from £ 14,250), while those with assets of £ 100,000 are eligible for community assistance (from £ 23,250).
Once the limit is reached, the government pays the cost of caring for the person.
– What’s the new change everyone’s talking about?
Last week the government said that only people’s individual payments will be used for the cap, with on-demand funding not counting.
This is to ensure that people “do not artificially reach the upper limit faster than they contribute”.
To this end, the government plans to amend the Care Act, subject to parliamentary approval.
– What does that mean in practice?
The overall goal stays the same – no one pays more than £ 86,000 for their care, regardless of their personal wealth.
However, the new change means that when poorer people need longer care, those costs will consume more of their wealth, and for longer.
For example, a person with wealth of £ 106,000 pays the full £ 86,000 – about 81% of their wealth.
A person with five times wealth pays exactly the same amount, but that is only 16% of their wealth.
People with assets between £ 20,000 and £ 100,000 do not pay the full amount of their care each week for support and therefore take longer to reach the cap.
– What is the problem?
Critics say this deviates from the originally proposed ceiling as poorer households receive “far less protection than expected”.
They say this change will disproportionately affect poorer retirees with longer care costs, including those living in the north and in areas with lower house prices.
The Resolution Foundation said there was a “strong geographic dimension” with those in the North East, North West and Yorkshire most at risk of their wealth being destroyed.
The Prime Minister has been warned that some Conservative MPs will not support the new policy.
– How are the proposals compared to the existing system?
The welcomed more generous means test will mean that more people will receive financial help from their community.
With regards to the cap, anyone currently at risk of catastrophic care costs will now be protected from paying more than £ 86,000.
People who pay for all or part of their care will spend less than they would if they had been in need of care longer, but the wealthiest would see a greater part of their wealth protected.
The less affluent may still be forced to sell their home or use up most of their savings to pay for upkeep.
Even so, the Resolution Foundation said the proposals represent “a significant improvement” over the current system.
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